Does rail transportation matter for climate outcomes? evidence from public transport systems in Asia

The transport sector has emerged as a significant contributor to carbon dioxide emissions in Asia, driven by rapid economic growth, urbanization, and transportation demand. While the government has focused on the use of public transportation for mitigating carbon emissions, there is a lack of empirical evidence on its environmental impact. This research attempts to understand the impact of rail transportation on carbon dioxide emissions in 16 countries in Asia from 2005 to 2019. Panel data regression techniques, such as pooled OLS, fixed-effects, and random-effects, are employed, in addition to Structural Equation Model to understand the direct and indirect impact of public rail investment on the environment. The result show that the rail transportation has a significant impact on carbon emissions as a 1% increase in railway infrastructure is associated with approximately 0.138% reduction in CO 2 emissions. Urbanization, however, has a positive and significant impact on carbon emissions. In addition, analysis of regional heterogeneity revealed that rail transportation has a significant impact on carbon emissions in Asia, although the impact is low in South Asia.